Greeks Reject Austerity Measures, Finance Minister Resigns

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Mon, Jul 6 - 3:30 am EDT | 3 years ago by
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The citizens of Greece have spoken: the country will refuse to comply with the strict austerity measures called for by the other countries in the Eurozone that aim to repair Greece’s devastated economy. In doing so, Greece has thrown a wrench into the negotiations involving an international bailout for its ailing financial system, with critics warning that Greece has only worsened its bargaining position thanks to the bold move.

Greek Prime Minister Alexis Tsipras
Photo by Milos Bicanski/Getty Images

Greek Prime Minister Alexis Tsipras, who has only held the office for five months, spearheaded the opposition to the austerity measures. The referendum, called for by Tsipras, was the first vote of its kind in the country in over four decades. Sixty-one percent of voters rejected the austerity measures while only 37 percent voted in favor of them.

“Today we celebrate the victory of democracy,” Tsipras said in a televised address. “We proved even in the most difficult circumstances that democracy won’t be blackmailed,” he said. Tsipras’ government had claimed that rejecting the austerity measures would give Greece the ability to negotiate a more favorable bailout without having to accept the draconian restrictions supported by countries like Germany and France.

While the mood is largely jubilant across Greece, with a sizable crowd gathering to celebrate in front of the parliament building in Athens, officials throughout the rest of Europe have expressed concern for the country’s future. “For recovery of the Greek economy, difficult measures and reforms are inevitable,” said Jeroen Dijsselbloem, leader of the Eurogroup and finance minister for the Netherlands. “We will now wait for the initiatives of the Greek authorities.”

Other influential European figures were not as optimistic. Sigmar Gabriel, vice chancellor and economic minister of Germany, said that Tsipras has “torn down the last bridges, across which Europe and Greece could move toward a compromise. By saying ‘no’ to the eurozone’s rules, as is reflected in the majority ‘no’ vote, it’s difficult to imagine negotiations over an aid package for billions.”

Last week, the Greek government implemented a severe limitation on cash withdrawals from ATMs in order to combat a dramatic lack of capital in the country. Citizens are currently only allowed to withdraw 60 euros daily, or $67, and it is unclear how long the limitation will last. Some analysts worry that the situation will worsen so much that Greece will be forced to print its own currency, especially if Tsipras is unable to secure a bailout deal in the short term.

 Greek Finance  Minister Yanis Varoufakis
Photo by Milos Bicanski/Getty Images

After voters rejected the austerity measures in Sunday’s referendum, voting against the bailout terms, on Monday Greek Finance Minister Yanis Varoufakis announced his resignation. There was no immediate announcement of his replacement.

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